JAMM AQUINO / JAQUINO@STARBULLETIN.COM
Renovations to the Royal Hawaiian Shopping Center are now expected to be complete in early 2008. The project, which was originally slated to finish in 2006 for $84 million, is "substantially" over budget, in part because of modifications to accommodate new tenants. Above, construction was underway as the center hosted a sneak peek for travel writers Tuesday.

A royal renovation

The Royal Hawaiian Shopping Center, set to open in 2008, will be "worth the wait"

It's more than a year behind schedule and significantly over budget, but those connected to the Royal Hawaiian Shopping Center renovation say that when the project is finally revealed it will prove to be worth the added time and money.

"We had some unexpected conditions, but there were some retail opportunities that we decided to act on as well," said Susan Todani, director of development and planning for Kamehameha Schools, the owner of the Royal Hawaiian Shopping Center.

The entire center, which will encompass 310,000 square feet at completion, now is expected to be complete by year's end, with all tenants opening by the first quarter of 2008, Todani said.

"It will be well worth the wait," she said. It will be over budget by a "substantial amount" but she declined to give an exact figure.

Overhaul of the prime Waikiki retail center, which sits at the 50-yard line of the state's busiest tourist district, was originally targeted for a 2006 completion and budgeted at $84 million. A tight construction labor market, last year's 44-day deluge of heavy rains, the discovery of unanticipated piping needs and the movement of six tenants extended the center's construction time table, increased costs and temporarily softened sales, said Marleen Akau, general manager of the Royal Hawaiian Shopping Center.

"In the beginning we saw sales decline," Akau said, adding that sales have been improving since the construction barricades fronting Kalakaua Avenue have been removed, she said.

JAMM AQUINO / JAQUINO@STARBULLETIN.COM
The Royal Hawaiian Shopping Center's multimillion-dollar renovation, originally slated for completion in 2006, has been slowed in part by modifications to accommodate new tenants. Above, Dawn Ramsey, second from left, waited to greet travel writers at the Royal Grove in the center on Tuesday.

Further delays were caused when Kamehameha Schools and the Festival Companies decided to broaden the scope of their original plans, Todani said.

After the original plans for the center were in place, developers reached an agreement with Hilo Hattie to open a 29,000-square-foot store -- the company's biggest on island, she said.

"They'll be an incredible draw," Todani said. "This store will be bigger than their Nimitz Store and they get 1.5 million visitors each year."

In addition, developers also decided to add a bar and a 10-restaurant food court, called Paina Lanai, to cater to shoppers on the second level of building B and provide a scenic overlook to watch the entertainment and activities that are taking place below in the Royal Grove, she said.

The bulk of the center, which will be home to more than 100 stores, restaurants and entertainment venues spanning three blocks, will be leased by year's end, Akau said.

Senor Frogs Restaurant and Bar is expected to hold a grand opening in July, she said. The Paina Lanai will open in November and its local bar operator will be revealed at that time, Akau said. The long-awaited historic Royal Grove is slated to open in December, she said.

To date, approximately 80 percent of the center renovations have been completed and it is 95 percent leased with about 20,000 square feet remaining, Akau said.

"We're looking for three anchor restaurants or tenants," Akau said. "Negotiations are competitive. We've got at least three or four offers on the space."